April 2, 2016

Forecast

  • Additive manufacturing, commonly known as 3-D printing, and other advanced manufacturing technologies will shorten and simplify global supply chains in the coming decades.
  • As they do, manufacturing will migrate back to former and current industrial nations.
  • New technologies will simultaneously prevent developing countries from using low-level manufacturing to bolster economic growth.

Analysis

The world is in the early stages of another industrial revolution, one that could reverse some aspects of globalization. Additive manufacturing, more commonly known as 3-D printing, as well as intelligent industrial robotics and other software-based manufacturing technologies, are reducing the advantage of low labor costs. Eventually, they will fundamentally change how goods are made by enabling manufacturing to move closer to consumer markets and eliminating the need to search for cheap labor or produce and assemble parts in different locations away from the assembly plant. These changes will decrease trade in intermediate goods and components and lessen the need for physical inventories, shortening and simplifying global supply chains in the long run.

Additive manufacturing is a broad term that applies to machines using various techniques, including lasers, heat or ultraviolet light, to build items made of any number of materials. Adding materials layer by layer allows for the production of new and more complex products that are lighter and use less material than those made with molds or other traditional manufacturing methods. Because computer software and digital data control the design, several different products or components can also be made on the same machine. Industries with high-value, low-volume products or parts, including the medical, aerospace and automotive industries, have already adopted this technology and will drive much of its initial development.

Needed Improvements

But to fully integrate additive manufacturing into mainstream commercial production, making actual components and products instead of prototypes, several hurdles still need to be overcome, especially for printing metal parts. Metal printing, unlike plastic printing, is expensive. Costs will need to fall before the technique can be used in manufacturing, especially since the printers currently account for between 40 percent and 60 percent of the total unit cost of sintering-based technologies. (Sintering means binding particles of a material into a solid mass through heat or pressure.) The expiration of key patents in 2014 will help lower the cost of machines that use laser sintering to fuse metal layers together; similar patent expirations in 2009 helped drive down the cost of fused deposition printers, an additive manufacturing technology used for modeling, prototyping and production. However, even if the metal printing machines become cheaper, they will still be slow — today such products take hours or days to print, depending on their size — and mainstream incorporation will remain elusive.

The quality of completed 3-D printed products must also improve enough to remove the need for additional finishing processes. Many additive manufacturing techniques do not meet traditional industry standards for accuracy or uniformity, and they often require additional processing before the part or product can be used for its intended purpose. Developing standards specific to additive manufacturing among all the industry players will be crucial to its wider success.

Of course, these advancements will partially depend on the materials used in the process, including metal, ceramic, plastic or any future materials. As the volume of metal printing increases, so, too, will the demand for a key component: metal powder. The powder must be uniform, free of defects and high quality, regardless of the metal used. Today’s powders, even those of the highest quality, are not optimal for 3-D printing. Further investment into material science research and development will be needed to meet the demand for high-quality materials and to help eliminate post-printing modifications.

And indeed, some improvements are already being made. The cost of metal printing is expected to decline as competition grows and technologies mature, and production speed will probably rise rapidly. Likely achievements in the computing are also important, since machines’ software programing is equally vital to the entire production process.

However, 3-D printing will have the largest impact on global supply chains when printing multiple materials from the same machine becomes more affordable. Researchers at MIT recently announced the development of an inexpensive multicomponent printer that, though still in its early stages, shows promise. In time, their efforts could enable more parts of a product to be produced in a single location and reduce the number of separate components needed, simplifying supply chains and encouraging the technique’s spread to many different sectors.

A Tipping Point

Despite the need for improvements, 3-D printing is already being incorporated into production in several industries. For example, hearing aid manufacturers in the medical industry have switched over to additive manufacturing methods, completely pushing out traditional manufacturers. (Hearing aids’ small size makes them ideal for 3-D printing.) Moreover, other major companies, including GE, Lockheed Martin, Boeing, Airbus and Google, are beginning to integrate the technology into their production processes as well. Sales of metal printers nearly doubled between 2013 and 2014. And the aerospace industry will continue to adopt the new techniques to make lighter, stronger structures required for its products.

Over the next two years, progress in 3-D printing technology will benefit the commercial sector. In 2016, GE will launch a new LEAP engine that uses 19 fuel nozzles produced by additive manufacturing. They are simpler and 25 percent lighter, reducing the number of separate parts in the nozzle from 18 to one. GE’s success could certainly convince aerospace companies to jump on the 3-D printing bandwagon. Meanwhile, Carbon3D is gearing up to release its continuous liquid interface production method, which enables the printing of polymeric materials at speeds 25-100 times faster than the current rates, to the market this year. Developers of a new method known as high-speed sintering, which uses infrared lamp heating, are expected to release the technique in 2017, similarly increasing metal printer production rates by 10-100 times.

Still, the switch to additive manufacturing in the commercial sector will be gradual, much like it is for the transportation industry, because of the long lifetimes of traditional manufacturing equipment.

Changes in Trade

Additive manufacturing will not be the sole driver of the coming industrial transition that is poised to limit or even reverse globalization. However it, along with the Internet of Things (which at its heart simply connects devices to one another so they can communicate and become more efficient and effective), intelligent industrial robots, artificial intelligence and other technologies, will move manufacturing closer to the point of consumption, shortening and simplifying supply chains by reducing the need to import intermediate goods.

Developed nations, especially the United States, parts of Asia (Japan, China, Taiwan, South Korea and Singapore) and Northern Europe, will be the first to develop and adopt 3-D printing technologies. They will also be the ones to benefit most from the technologies, which will raise the productivity of highly-skilled workforces to the point that assembly, fabrication and processing using cheap labor no longer makes business sense. Put another way, 3-D printing could reverse outsourcing.

Additive manufacturing will change countries’ domestic policies as well. For example, China is seeking to end its dependence on foreign technology to promote its own technology sector. Consequently, the incorporation of new 3-D printing methods there will be more rapid than might otherwise be expected. Different production specialties may also become more concentrated by region. Furthermore, U.S. government support and initiatives for additive manufacturing could even be used to benefit the rusting Steel Belt running from Pennsylvania to Michigan, the United States’ former manufacturing heartland.

Developing countries may not fare so well as 3-D printing and other technologies diminish their opportunities for growth. As trade moves more toward finished products — many produced in or near consuming nations — there will be fewer chances for developing countries to promote economic development and diversification. As a result, low-end manufacturing’s role as a catalyst for industrialization and growth in the developing world may weaken as the next industrial revolution unfolds.

Adding New Layers to 3-D Printing is republished with permission of Stratfor.